1. In what major business segment(s) does Whole Foods operate?
a. Vitality and well being
b. Food retailer
c. Natural and organic foods supermarkets
d. Promotion of organically grown foods, healthy eating, and the sustainability of our entire ecosystem.
2. Where does Whole Foods discuss its accounting policies?
a. Notes to the financial statements
b. Item 7: Management Discussion and Analysis of Financial condition and Results of Operations
3. In what geographic segments does Whole Foods operate?
a. United States, Canada, and the United Kingdom
b. Americas, and Western Europe
c. Austin, Texas
d. Worldwide
4. On which stock exchange is Whole Foods traded?
a. Penny stocks
b. AMEX
c. NASDAQ
d. NYSE
5. What is the annual report that provides a comprehensive overview of the company's business and financial condition and includes audited financial statements?
a. SEC Form 10-K
b. SEC Form 8-K
c. SEC Form 10-Q
d. SEC Def 14-A
6. What is the SEC report that includes unaudited financial statements and provides a continuing view of the company's financial position during the year, and must be filed for each of the first three fiscal quarters of the company's fiscal year?
a. SEC Form 10-K
b. SEC Form 8-K
c. SEC Form 10-Q
d. SEC Def 14-A
7. Who is Whole Foods’s auditor?
a. KPMG
b. Deloitte
c. Ernst & Young
d. PriceWaterhouseCoopers
8. Did Whole Foods get an “unqualified” opinion?
a. Yes
b. No
9. What covers three financial aspects of an enterprise’s business – liquidity, capital resources, and results of operations. It requires management to highlight favorable or unfavorable trends and to identify significant events and uncertainties that affect these three factors.
a. Proxy statement
b. MD&A (Management’s Discussion and Analysis)
c. Statement of Retained Earnings
d. Press release
10. What are US publicly traded firms required to file with the SEC when soliciting shareholder votes? This statement is useful in assessing how management is paid and potential conflict-of-interest issues with auditors. The statement includes: voting procedure and information; background information about the company's nominated directors; director compensation; executive compensation; a breakdown of audit and non-audit fees paid to the auditor
a. Proxy statement
b. MD&A (Management’s Discussion and Analysis)
c. Statement of Retained Earnings
d. Press release
11. Does Whole Foods have any incentive compensation plans for its employees?
a. Yes
b. No
12. Subsequent events are defined as the disclosure of material events or transactions that occur between the balance sheet date and its issuance date. Did Whole Foods disclose subsequent events in its 2013 financial statements?
a. Yes
b. No
13. On which statement does Whole Foods report total comprehensive income for 2013?
a. Consolidated Statements of Consolidated Shareholders’ Equity
b. Consolidated Statements of Comprehensive Income
c. Consolidated Statements of Income
d. Consolidated Statements of Cashflows
Income Statement questions
(Hint: some answers may be in the footnotes or on a different statement than the income statement.)
14. Does Whole Foods use the multi-step or single step method?
a. Multi-step
b. Single-step
15. Compared to 2012, is Whole Foods’s total cost of goods sold and occupancy costs going up or down in 2013?
a. Up
b. Down
16. Compared to 2012, as a percent of sales, is Whole Foods’s cost of goods sold and occupancy costs going up or down in 2013?
a. Up
b. Down
17. Compared to 2012, as a percent of sales, is Whole Foods’s net income going up or down in 2013?
a. Up
b. Down
18. Does Whole Foods report any discontinued operations or extraordinary items?
a. Yes
b. No
19. Does the company have any restructuring charges in 2013?
a. Yes
b. No
20. Did Whole Foods pay any preferred or common stock dividends in 2013?
a. Yes
b. No
21. What is the denominator (in millions) for the calculation of the 2013 Basic EPS of $1.48?
a. $372.4
b. $364.8
c. $371.2
d. $374.5
22. What is the numerator (in millions) for the calculation of the 2013 Basic EPS of $1.48?
a. $508
b. $883
c. $43
d. $551
Balance Sheet questions
23. What is a classified balance sheet?
a. A multi-step balance sheet
b. A balance sheet that separates assets and liabilities into current and non-current sections
c. A balance sheet that reports assets in the reverse order of liquidity
d. A balance sheet that has a restricted audience
24. Does Whole Foods have a classified balance sheet?
a. Yes
b. No
25. What is the restricted cash related to?
a. Sinking fund for bond obligations
b. Rent guarantees on operating leases
c. Collateral to support workers’ compensation obligations and operating lease rent guarantees
d. Cash held on behalf of executive shareholders
26. Does Whole Foods have retained earnings or an accumulated deficit in 2013?
a. Retained earnings
b. Accumulated deficit
27. What is the dollar amount of the retained earnings or accumulated deficit in 2013 (in millions)?
a. $3,878
b. $ 5
c. $1,233
d. $1,265
28. What is an “accumulated deficit?”
a. This occurs when a company has generated more losses than profits for a given year.
b. This occurs when a company pays dividends during a given year.
c. This occurs when a company pays dividends every year.
d. This occurs when a company has generated more losses over its life than profits.
29. Is it possible for an accumulated deficit to ever go away?
a. Yes
b. No
30. Is it possible for a company to have an accumulated deficit and cash at the same time?
a. Yes
b. No
31. What is the 9/30/13 balance in Whole Foods’s accumulated other comprehensive income (in millions)?
a. $1
b. $5
c. $551
d. $547
32. What types of items are included in Whole Foods’ other comprehensive income?
a. Dividends declared
b. Foreign currency translation adjustments
c. Net income
d. All of the above
33. What types of assets does the company use fair value measurements for?
a. Derivative financial instruments
b. Investments
c. Financial assets and liabilities
d. All of the above
34. What is the dollar value (in millions) of 9/30/13 financial assets using the Level 1 fair value hierarchy? Level 2? Level 3?
a. $16, $1,360,and $0, respectively
b. $73, $1,156, and $0, respectively
c. $151, $512, and $663, respectively
d. None of the above
Statement of Cashflows questions
35. Does Whole Foods use the direct or indirect method?
a. Direct
b. Indirect
36. Why doesn’t cash flow from operations equal net income?
a. The income statement includes non-cash items
b. The income statement is based on accruals
c. All of the above
d. None of the above
Financial ratio questions [Must use the ratio formulas from Keiso Appendix 5A for calculations]
37. What is Whole Foods’s 2013 current ratio?
a. 2.15
b. 1.82
c. 3.34
d. None of the above
38. Has Whole Foods’s current ratio increased or decreased from 2012?
a. Increased
b. Decreased
39. What is Whole Foods’s 2013 inventory turnover?
a. 20.02
b. 18.22
c. 21.04
d. None of the above
40. What is Whole Foods’s 2013 rate of return on assets?
a. 10.41%
b. 9.95%
c. 10.17%
d. None of the above
Revenue Recognition, receivables and cash questions
41. What is Whole Foods’s (WF) revenue recognition policy?
a. WF recognizes revenue for sales of its products at the point of sale.
b. WF recognizes net revenues when the earnings process is complete, as evidenced by an agreement with the customer, transfer of title and acceptance if applicable, fixed pricing and probable collectability.
c. WF recognizes revenue prior to completion and delivery.
d. WF defers the recognition of revenue to future periods of anticipated cash collections.
42. What does “cash equivalent” mean?
a. Cash and short-term, highly liquid investments with maturities of three months or less a date of purchase.
b. Cash and short-term, highly liquid investments with maturities of three months at the balance sheet date.
c. All of the above.
d. None of the above.
43. What was the amount of the allowance for doubtful accounts at 9/30/13?
a. $191 million
b. $188 million
c. $4.0 million
d. $3.0 million
Inventory question
44. What valuation and cost method does Whole Foods use?
a. Inventories are valued at lower of cost or market and costs are determined on a dollar value retail LIFO basis.
b. Inventories are valued at lower of cost or market and costs are determined on a FIFO basis.
c. Whole Foods uses both above methods.
d. Whole Foods uses neither of the above methods in a & b.
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